Shattuck v. Kalispell Regional Medical Center, Inc.
2011 MT 229
| Mont. | 2011Background
- Dane Shattuck, a minor, died in July 2007 after injuries from a third‑party tortfeasor; he was enrolled in CHIP, administered by DPHHS, and KRMC billed CHIP/BCBSMT for Dane's care.
- KRMC’s charge was $2,365.75; BCBSMT, as CHIP’s administrator, paid $2,005.85 to KRMC under the provider agreement.
- Shattuck asserted KRMC’s lien against third‑party recoveries was unnecessary since CHIP paid the bill; KRMC argued BCBSMT could not release the lien without risking its payment responsibilities.
- Shattuck alleged various contract and fraud theories and that Defendants violated the “made whole” doctrine; the case sought lien release and damages.
- The District Court ruled CHIP constitutes insurance and subject to the Montana “made whole” statute but BCBSMT is not an insurer; it certified the ruling as final, which was appealed.
- On remand, DPHHS’ status as CHIP administrator was reconsidered; CHIP was reaffirmed as not insurance; Rule 54(b) certification was affirmed for appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is CHIP insurance under the Montana made‑whole statute? | Shattuck argued CHIP is insurance. | KRMC/BCBSMT argued CHIP is not insurance. | CHIP is not insurance; not subject to made‑whole. |
| Is BCBSMT an insurer for CHIP under the made‑whole rule? | BCBSMT should be treated as an insurer. | BCBSMT is not an insurer, only a TPA. | BCBSMT is not an insurer; made‑whole does not apply. |
| If CHIP is not insurance, does the made‑whole doctrine apply by common law or constitutional doctrine? | Argued for common law/constitutional made‑whole. | No applicability since CHIP isn’t insurance. | Made‑whole doctrine not triggered by CHIP under common law or Constitution. |
Key Cases Cited
- Skauge v. Mountain States Telephone & Telegraph Co., 172 Mont. 521, 565 P.2d 628 (Mont. 1977) (made‑whole when insurer payment is less than loss)
- Thayer v. Uninsured Employers' Fund, 297 Mont. 179, 991 P.2d 447 (Mont. 1999) (UEF not an insurer; public assistance fund; made‑whole analysis)
- Ness v. Anaconda Minerals Co., 279 Mont. 472, 929 P.2d 205 (Mont. 1996) (subrogation/made‑whole framework in insurer context)
- Zacher v. American Insurance Co., 243 Mont. 226, 794 P.2d 335 (Mont. 1990) (made‑whole principles within insurance context)
- Ogden v. Montana Power Co., 229 Mont. 387, 747 P.2d 201 (Mont. 1987) (insurer/business of insurance; not utility provider in insurance sense)
- Swanson v. Hartford Insurance Co., 2002 MT 81, 46 P.3d 584 (Mont. 2002) (made‑whole considerations in Montana)